Bayhorse Silver Inc.

is a junior exploration company with a 100% interest in its three major high grade New Zealand gold prospects (Alexander River, Paparoa and Lyell), in the highly prolific West Coast South Island gold fields of New Zealand, where it offers investors the potential for a major gold discovery and is earning an 80% interest in its newly acquired historic Bayhorse Silver Mine that has the potential for a substantial silver discovery.

Bayhorse Silver Mine Oregon

Mining has been conducted intermittently at Bayhorse since the early 1920′s and the mine last closed after the price of silver dropped to under US$6/oz in late 1984. The property has remained dormant since. The Bayhorse mine has two existing accessible adits, the upper extending about 800 feet westward into the hill and the lower extending about 500 feet into the hill. A middle level is reached only by raises from the lower level and winzes from the upper level. Three areas have been stopped in the ground between the upper and middle level.

As “stated in the minerals production yearbook” (Jacobsen, 1959), total reported historic production from the Bayhorse Mine through 1959 was 286,000 ounces of silver from 8,300 tons of ore for an average of approximately 35.5 opt Ag (1,217 g/t Ag).Herdrick (1981) estimated remaining shipping ore at a 7.5 opt Ag cutoff to be 166,208 tons, and on-site mill ore at a 3 opt Ag cutoff to be 473,350 tons. Herdrick provides no production and shipping records

According to other more recent reports in 1984, 90 underground drill holes totaling approximately 15,000 feet reportedly delineated approximately 26,000 tons of silver bearing mineralization of which 5,718 tons were reported being produced at an average grade of 16.7 opt Ag (572.5 g/t Ag) while approximately 20,000 tons at an average of 15 opt Ag reportedly remained unmined. The historic records also indicate that of the 5,718 tons produced, approximately 23% reportedly graded between 21 – 100 opt Ag, 71% reportedly graded between 6 opt – 20 opt Ag and 6% reportedly graded less than 6 opt Ag. Ancilliary copper produced reportedly averaged 1% Cu. The highest reported grade from the 1984 drilling, sampling and mining program was a round that reportedly assayed 691 opt Ag (23,691 g/t Ag) and 15.72% Cu from a tetrahedrite-tennantite rich vein.

Both adits on the property are open, but the workings are not entirely accessible at present due to safety issues. Historic reports indicate that the mineralization, consisting mainly of tehrahedrite/tennantite, occurs in a 60-80 feet wide in a zone along an andesite and rhyolite contact. Minor copper, arsenic, and vanadium are associated with the silver. Azurite and malachite coatings are common in oxidized parts of mineralized ground on the walls of the excavated stopes. Additional minerals include enargite, dufrenoysite and cuprodesclosite. Gold values of up to 10 g/t Au have also been reported in the mineralization.

The Company has an experienced management and technical team with extensive exploration expertise.

The two highest grade samples (GRBH-20 and GRBH-19) were taken 4 meters apart from a 4-cm thick massive sulfosalt-sphalerite vein that occupies a faulted rhyolite-andesite contact. This vein outcrops above the Upper Adit entrance that accesses the historic underground workings. The two samples weighed approximately 1.5 kg each. The samples were submitted under chain of custody to the certified ALS Chemex laboratory in Elko Nevada for analysis.

Ag

Cu

Pb

Zn

Ag

Ag

Sample

Sample Type

g/t

%

%

%

oz/tonne

kg/t

GRBH-01

Low grade stockpile rhyolite

118

2.65

3.79

GRBH-02

Low grade stockpile rhyolite

902

1.17

2.39

29

0.9

GRBH-03

Low grade stockpile rhyolite

888

3.06

2.4

28.55

0.9

GRBH-04

Low grade stockpile rhyolite

176

1.1

5.66

GRBH-05

Low grade stockpile rhyolite

197

6.33

GRBH-06

Quartz vein upper adit

1.73

0.05

GRBH-07

Low grade stockpile rhyolite

641

5.12

3.7

20.61

GRBH-08

Low grade stockpile rhyolite

84.6

0.99

2.72

GRBH-09

Andesite outcrop 70ft north of Upper Adit

1,020

2.95

1.13

32.79

1.02

GRBH-10

Composite quartz vein samples

5.79

0.186

GRBH-11

Outcrop rhyolite

9.96

0.32

GRBH-12

Outcrop rhyolite

10.4

0.33

GRBH-13

Outcrop rhyolite 160ft south of Upper Adit

1,190

3.69

38.26

1.19

GRBH-14

Quartz vein float 1600ft west of Upper Adit

1.59

0.03

GRBH-15

Composite quartz vein float 1600ft west of Upper Adit

9.23

0.29

GRBH-16

Composite quartz vein float

4.06

0.13

GRBH-17

Faulted outcrop 750ft west of adit

0.66

-

GRBH-18

Outcrop 400ft west of Upper Adit

5.14

1.19

0.16

GRBH-19

4 cm vein outcrop at Upper Adit*

88,206

11.9

1.25

8.97

2,836

88.2

GRBH-20

4 cm vein outcrop at Upper Adit *

150,370

17.85

1.21

8.67

4,835

150.4

GRBH-21

Composite rhyolite float Upper Adit

710

2.5

22.83

(“grab samples are selective by nature and are unlikely to represent average grades of the deposits”)

Some samples were submitted to petrologist Dr. Craig Leitch, P.Eng., for thin and polished section studies. He reports that the 4-cm thick vein discovered at surface with bonanza silver grades contains sphalerite, with three distinct sulfosalt minerals (tennantite and two unidentified phases, possibly Ag-sulfosalts) as well as possible acanthite. In addition there was minor galena and chalcopyrite.

Based upon the significant results reported above, along with the following historic information, the Company has decided to initiate metallurgical assessment of an approximately 250 kg bulk sample of mineralized material from an onsite, apparent low-grade ore dump, to be submitted to Met-Solve laboratories in Abbotsford, BC. By doing so, the Company hopes to confirm the reported historic flotation recoveries in excess of 80% silver and to determine the best method to achieve a saleable concentrate in the event that the historic information reported below can be substantiated.

Historic Information:

The Company advises that the following information is of a historic nature. Historic production estimates, drill information and grades reported have not been verified; A qualified person has not done sufficient work to verify the historical estimates nor classify the historical estimates as current mineral resources or mineral reserves and the Company is not treating the historical estimates as current mineral resources or mineral reserves. (ounces/grams conversion is one ounce/short ton = 34.2857 grams/metric ton)

As “stated in the minerals production yearbook” (Jacobsen, 1959), total reported historic production from the Bayhorse Mine through 1959 was 286,000 ounces of silver from 8,300 tons of ore for an average of approximately 34.5 opt Ag (1,183 g/t Ag) while Herdrick (1981) estimated remaining shipping ore at a 7.5 opt Ag cutoff to be 166,208 tons, and on-site mill ore at a 3 opt Ag cutoff to be 473,350 tons.

According to other more recent reports in 1984, 90 underground drill holes totaling 15,000 feet reportedly delineated 26,000 tons of silver bearing mineralization of which 5,718 tons were reported being produced at an average grade of 16.7 opt Ag (572.5 g/t Ag) while approximately 20,000 tons at an average of 15 opt Ag reportedly remained unmined. The historic records also indicate that of the 5,718 tons produced, 23% reportedly graded between 21 – 100 opt Ag, 71% reportedly graded between 6 opt – 20 opt Ag and 6% reportedly graded less than 6 opt Ag. Ancillary copper produced reportedly averaged 1% Cu. The highest reported grade from the 1984 drilling, sampling and mining program was from a mined round, containing a tetrahedrite-tennantite –rich vein, that assayed 691 opt Ag (23,691 g/t) and 15.72% Cu.